On March 12, 2026, the Fourth Circuit upheld a $42 million damages award for claims brought under the Alien Tort Statute (ATS) in CACI Premier Technology Inc. v. Al Shimari. As we described, the decision carried “sweeping implications for government contractors operating in hostile and combat-adjacent environments, particularly those providing services that intersect closely with inherently governmental functions.” But just as the Fourth Circuit giveth, the Supreme Court taketh away. In June, the Supreme Court drastically limited the universe of potential ATS liability, and last week the Fourth Circuit vacated its earlier ruling.

The ATS provides federal district courts with jurisdiction to hear “any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.”  When the ATS became law in 1789, the only recognized offenses against the “law of nations” were violation of safe conducts, infringement of the rights of ambassadors, and piracy. For nearly 200 years, the ATS laid mostly dormant, and its jurisdictional grant was rarely invoked. That changed in 1980, when the Second Circuit held that the ATS opened the federal courts for adjudication of the rights “already recognized by international law.” In 2004, the Supreme Court interpreted the ATS in Sosa v. Alvarez-Machain and held that the ATS did not allow the federal courts to create causes of action, but conferred jurisdiction for violations of the present-day law of nations, as determined by looking at the norms of international character and specificity analogous to the 18th-century violations (e.g., piracy).

In CACI Premier, former detainees at Abu Ghraib prison during the Iraq War prevailed at trial on their claims under the ATS, alleging that the federal contractor CACI had conspired to commit torture and conspired to commit cruel, inhuman, and degrading treatment (“CIDT”). After the Fourth Circuit issued its decision upholding the $42 million jury verdict, CACI petitioned for rehearing.

While that petition was pending, the ATS landscape underwent a significant shift. In June 2026, the Supreme Court issued its decision in Cisco Systems Inc. v. Doe I.

The ATS claims in CISCO Systems were brought by practitioners of the Falun Gong religious movement, who alleged that Cisco had enabled their persecution by the Chinese government through its development of surveillance technology.  The complaint alleged that Cisco and its executives aided and abetted violations of international law—namely, torture; cruel, inhuman, or degrading treatment; prolonged and arbitrary detention; forced labor; crimes against humanity; extrajudicial killing; and forced disappearance. The federal district court found that it did not have jurisdiction under the ATS because there was not a “sufficient nexus between [Cisco’s] actions and the alleged violations [of international law] committed by Chinese actors on Chinese soil[,]” and dismissed the complaint. The Ninth Circuit reversed and held that aiding and abetting liability is a viable form of liability under the ATS.

The Supreme Court then reversed the Ninth Circuit, holding that federal courts cannot create new causes of action to remedy violations of international law recognized today, while accepting the three recognized offenses against the law of nations in 1789.  This decision drastically limits the applicability of the ATS as a mechanism to remedy violations of international law and human rights in the U.S. federal courts, and in doing so “close[d] the door that Sosa cracked to judicially created ATS liability”, effectively overturning Sosa.

The Fourth Circuit granted CACI’s petition for panel rehearing and, based on Cisco Systems, held that the ATS claims in CACI Premier were not actionable under the ATS and must be dismissed. Federal courts across the country have similarly ordered the dismissal of other pending ATS claims. See, e.g., Xiong v. Lao People’s Democratic Republic, No. 25-5914, 2026 WL 2412771 (9th Cir. Aug. 18, 2026) (affirming dismissal of ATS claim based on Cisco Systems); Bassford v. City of Mesa, No. CV-25-01034-PHX-JAT (CDB), 2026 WL 2029994 (D. Ariz. July 14, 2026) (ordering dismissal of ATS claim based on Cisco Systems).

Key Takeaways:

  1. Contractor defenses unaffected. In March, we wrote about how the Fourth Circuit decision poked holes in the contractor’s derivative sovereign immunity defense and how it has wide implications for contractors, especially those operating in contingency environments.  Neither this decision (nor the Cisco Systems Supreme Court decision it rests on) changes that analysis meaningfully, as the ATS basis for the reversal here does not affect the ultimate views expressed about the defenses CACI had put forward.
  2. The ATS is no longer a viable mechanism for jurisdiction. In contrast to discussion about sovereign immunity defenses, Cisco Systems ends meaningful liability concerns for most U.S. contractors arising out of the ATS.

Contractors operating in hostile locations—whether in support of military operations, intelligence activities, diplomatic security, or other sensitive government missions—still face potential liability even after the ATS’ demise. Fluet’s Battlefield + Contingency Operations Practice has deep experience in government contracts, national security law, and contracting on the battlefield, and is uniquely positioned to advise contractors navigating these issues. For guidance on compliance strategies, contract structuring, and litigation risk management, please contact a member of our team.